Rethinking technology partnerships to thrive in the digital age
In the past few years, there have been some major enterprise-focused digital transformation initiatives across industries, along with a lot of innovation around big data and analytics. It’s fair to say that technology is at the core of business success, and a lot of importance is given to persona-based experience and process management. Since these are major technology shifts, enterprise CIOs/CMOs/CEOs are more confused than ever on how to take their companies on the digital transformation journey.
For enterprises looking to embark on this journey, having a detailed digital strategy is not enough. Enterprises need a firm plan to achieve their digital goals. According to a recent survey, 70% of the companies said they had a formal digital strategy that had been documented and agreed on by stakeholders. However, just 10% said they had a plan to deploy that strategy.
Each enterprise strategy/solution is unique. Therefore, the role of system integrators (SIs) has become critical. A resourceful SI should be able to help bridge the gap between strategy and execution.
The following are some of the challenges preventing enterprises from starting on a digital journey:
- Some enterprises have an overload of legacy systems and platforms, and scattered employee and customer data
- There are concerns over the security of their data during the digital transformation journey
- A lack of clear understanding of the issues and internal skills to address them
- A lack of funds to execute on their digital strategy
Enterprises with strategic partnerships need help from their external partners to pull together a strategy/roadmap for their digital transformation journey and also put together a detailed plan to execute it. The survey also showed that 92% of the companies face difficulties in keeping up with the pace of technological changes. This is where SIs come in.
Most companies are now looking to scale digital transformation across the enterprise and realign their processes and systems accordingly without having to alter their strategy drastically. Such business and technology shifts have prompted many entrepreneurs to launch new start-ups. VCs are also gearing up for IPOs and major buyouts, so they can turn around their own fortunes.
However, only a few of these start-ups can address the issue of digital transformation in its entirety. This is because digital transformation is too large for a single or even a handful of companies to address. This is where global SIs can play a major role. But most traditional SIs are slow to react to these changes. Even though smaller SIs can be more agile, very few of them have the scope to provide comprehensive digital solution to enterprise customers.
The following are some of the challenges that most global SIs face:
- Understanding the technology changes and customer challenges and retuning and refocusing their internal R&D quickly to retrain their resources
- Balancing existing accounts with technology partners that are fetching their current revenue streams with appropriate investment whilst expanding into newer areas at the same time
- Convincing the customers that they are proposing changes in their best interest and underlining the fact that they are best suited to take them on their digital transformation journey
- Preparing themselves to not only implement digital strategy but also fund development for their enterprise customers and in turn get returns from the savings the customers would enjoy. This will also give the confidence to some customers, who do not have necessary funds currently, to begin the digital journey with their SI partner
Irrespective of how the global SIs decide to play out in the digital transformation journey, they still need to understand the changes and quickly transform themselves to adapt to these changes. The best way to do this is to:
- First, realign themselves so all their internal teams and their solutions are pulled together into a single entity
- Embrace new age partners who could possibly offer differentiation to cover niche areas of end-to-end customer solution
- Partner with companies that are also growing at the same pace, to help them accelerate their own growth. This kind of growth can only come from new-age technology partners.
The enterprise strategy of global SIs should really be charted out with a long-term view in mind and should evolve based on customer needs. This is important as improving the customer experience is the top driver of digital transformation for 69% of the surveyed companies.
As the customer relationship matures, they can plan on taking their partnership to the next level and possibly co-invest and co-innovate with select partners to bring out unique propositions to get ahead of the competition.
Global SIs need to analyze customer needs and quickly build strategic partnerships and POCs to prove their value to customers on their digital journey. In fact, some customers are keen to know if SIs have partnerships with some specific product vendors and if that strategic partnership can act as a catalyst in transforming their applications, systems, and processes.
The challenge is to identify niche companies like a diamond in the rough and quickly pull together much needed partnerships with new age partners to gain vantage before the competition catches up with them. Some global SIs have started to proactively invest in start-ups to lock in their support and gain an early advantage in their customer offerings.
In other words, global SIs need to be proactive in embracing these new age partnerships and invest appropriately. They should build partnerships and develop technologies and POCs in-house to prove to their customers that they have the necessary expertise and that they know how to make it work. It is better for them to have this discussion with their customers and chart out a plan as soon as possible to take the digital transformation journey ahead instead of letting the competition get the upper hand.
This article was written by Udaya Shankar, Vice-president, Digital & Analytics , HCL, and originally it was published here.